Doing a little informal research. Do you perform pre-funding (post closing) reviews of loans? If so, do you have dollar thresholds? Type thresholds? If not, what controls are in place that eliminate the need for pre-funding reviews? Finally, what is the size of your institution?

Thanks for your help!

I have done pre-funding of loans prior to releasing funds for 22 years at two banks. We have simplified the process at this bank that typical consumer loans under 25,000 do not require pre-funding. All Ag, Comm'l and non-typlical Consumer Loans must go thru a pre-funding review prior to booking a renewal or the release of funds. My previous bank was 1Billion and current bank is 400M. Please contact me with questions at dkarbs@cnb-enid.com

I've never done post-closing, pre-funding reviews, but I have done most other types of reviews. We're a $325 million bank. At one point we were doing pre-closing reviews of loans with aggregate indebtedness of over $500,000 (excepting small loans from pre-review). This was very helpful with correcting problems with insurance, corporate resolutions, co-approval, etc.

Our "controls" are somewhat twofold: on the front end we have a centralized document preparation area. The people in this department generally require that the "i's and t's" are dotted and crossed prior to completing the document preparation. On the other end our loan operations department inspects files that have been sent for "booking" to make sure that all disclosures, etc. are in place. We have a $500,000 aggregate indebtedness requirement for annual review of loans (the actual credit/collateral analysis) as well as a sample review of all other loans. We tend to emphasize reviewing commercial loans (we're primarily residential RE), high LTV loans, borrowers with lower credit scores, rental RE and unsecured loans. The central doc prep and loan operations reviews are geared more towards preventing/detecting exceptions while the others are the credit analysis.